This has been a dry topic for a few years now. The Automotive Retailer Dealer knows by now that compliance is playing a bigger part in our everyday business. Last November the Federal Trade Commission sent out certified letters to retailers requesting information about their business practices.
A request was made for copies of every retail installment contract the retailer enter into from October 2009 to present time. Many in our industry believed the FTC was looking for information about our indirect lending or BHPH practices. With the creation of the Consumer Finance Protection Bureau, it was to be expected.
What came as a surprised was the amount of information the FTC was requesting. The letter that many retailers had received requested information on the corporate structure of the dealership, revenues from the sale of new – used vehicles, copies of all service contracts sold and other financial products, documents that discuss any policies and procedures (a compliance work book), training manuals, documents concerning oral or written complaints, and any information the owners might have concerning any lawsuit proceedings.
While it appears many more changes are coming, one area that we seem to placing on the back burner is real-time harassment risks with employees in the dealership environment. Many of our retailers have in-depth harassment training, handbooks, and seminars; but most of the time it does not translate to the showroom floor.
The back office might have a compliance work book, harassment manuals, and seminars; but it seems on the showroom floor it is still the same old game. From playing with customer’s personal information to joking with our peers to the point that it might be considered harassment is still a very real threat to the owners of our profitable as well as our struggling dealerships. With what is becoming a strong sales year, I am sure many of the agencies will want even more information from us.
Well you allowed me to ramble on here tonight, but I hope what you are getting out of this is that you must get a handle on all things we consider as compliance related. Remember it is not how much you make; it is how much of it you can keep. Violation of these rules comes with a very high price tag today and it does not need to be that way.